First time buyer, could use some eyes on this purchase agreement

[bikensail9]

I've asked a broker for a copy of the purchase agreement beforehand and here's what he sent (attached). Would anyone with more experience be willing to offer their opinion?


Also, regarding the deposit, the broker said he will hold the check in his office until both parties have agreed to move forward at which point it will be deposited into an escrow account. Does that sound like normal operating procedure? I've heard of stories about people losing their deposit or not being able to easily get it back.


Thanks for any help!

[Reeve21]

Originally Posted by bikensail9

I've asked a broker for a copy of the purchase agreement beforehand and here's what he sent (attached). Would anyone with more experience be willing to offer their opinion?


Also, regarding the deposit, the broker said he will hold the check in his office until both parties have agreed to move forward at which point it will be deposited into an escrow account. Does that sound like normal operating procedure? I've heard of stories about people losing their deposit or not being able to easily get it back.


Thanks for any help!

Hate to see a first post not get any responses, but it is a tough question to answer without knowing the details of your transaction.

The good news is this is a "standard" form adopted by an industry trade group. I have used it (or a prior version) and it worked just fine. I prefer it to some other forms I've seen (but I've not closely read what you attached, so don't take this as an endorsement).

Normal practice is for the deposit to be held in escrow by the broker until closing. Sounds like he doesn't want to bother with any banking work until there is a solid deal. I'm not sure how that could hurt you as the buyer.

Good luck!

[gonesail]

it is a good faith exercise between you .. the broker and the seller. think about how you will feel when you have to wire the funds for the purchase at closing .. still not really owning the boat yet

[leecea]

I couldn't find a copy of my document but the one you attached didn't raise any red flags for me. The process we went through after this step is probably very common...

- Find a surveyor and then find a date that works for the surveyor, the seller, and you. You pay the surveyor and the yard doing the "short haul". I think our buyer arranged for the haul out.

- We got a very preliminary nod from the surveyor that day but it took a few days to get the full report. As this was our first boat we were not sure what to expect and the survey document was a bit overwhelming, but the conclusion was good.

- We had insurance ready. We also had a slip at out new marina reserved plus agreement from the existing marina that we could pay a day rate to keep the boat there while we got ready to move it.

- We made an offer asking for a relatively small amount off but the seller countered with an even smaller price reduction. At that point we'd seen quite a few boats and this was the best, so we accepted it.

- From that point I don't remember how long it took until it was all done and we had a boat!

[Katapult Mike]

Tha agreement looks pretty standard to me, as well as what the brodker proposes.

You have to take into account that, practically speaking, you are relying on the broker and his good reputation for a good outcome. Not sure how much you are pyaing for hte boat, but unless it is a really expensive one, expecting to resolve any dispute over your deposit through lawyers and courts is nto likely to be cost effective.

My suggestions: be clear, decisive and assertive in all your communications, respect deadline in the agreement, and don't waffle. I see a lot of problems where people want it both ways in their communications and cotnracts, do not send clear communications prior to deadlines, and then are surprised when disputes arise. Contract law is not rocket science.

[Rockinar]

Im not a contract expert but that form looks pretty standard.

Usual in the US the process for buyer goes like this..

1) Verbal offer
2) Put down deposit when offer accepted (you will only have X amount of days to back out and get deposit back)
3) Have survey done. Based on survey you haggle on price or walk and get your deposit back.
4) Get insurance. Id start shopping if things are looking good at survey.
5) Close.

If you drag your feet, make excuses and miss a deadline, the contract is void and you lose your deposit. If you need more time (honestly having difficultly getting survey or insurance) you need to talk the broker who will ask the seller to agree to an extension. Seller normally agrees if you have been honest and reasonable. If you are a pain buyer, dreamer, lazy or making up poor or endless excuses, seller can say "No" and the deal is dead.

[Shrew]

Originally Posted by Rockinar

Im not a contract expert but that form looks pretty standard.

Usual in the US the process for buyer goes like this..

1) Verbal offer
2) Put down deposit when offer accepted (you will only have X amount of days to back out and get deposit back)
3) Have survey done. Based on survey you haggle on price or walk and get your deposit back.
4) Get insurance. Id start shopping if things are looking good at survey.
5) Close.

I'll agree with almost all of this, except for 1 & 2. While you can offer and accept verbally, it means nothing without a singed P&S by both parties. With property and with boats, I've always submitted a signed P&S as the official offer. I've given small initial deposits with the P&S on occasion. Often I'll send the signed offer and send a larger deposit when I get the signed P&S from the seller.

The 'verbal' is the root of the frustration we hear a lot of from new buyers posting here. The broker can sit on a verbal, however he's ethically compelled to push the signed contract in front of the seller. At that point, it is your signed contract and earnest money deposit that stand against every tire kickers verbal 'go fish' (i.e. 'will you take $X for it?).